TaxTMI 
TaxTMI 
1998 (7) TMI 281
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....stoms import duty levied and paid Rs.   Rs.   1. Piston valves 84.61(1)    22,265.00 25,493.43 2. Sleeves spring holders 73.33/40(1) 15,554.00 24,653.09 3. Screws 73.32      95.00    119.43    4. Gland carrier Ring 84.03      71,487.00 54,330.12 Total : 1,09,401.00 1,04,596.07 There is no dispute in this appeal pertaining to Item (4) above. 4. It is the appellant's case that all the individuals spares are specially designed and intended to suit and use in their mills and therefore, they applied for reclassification of the goods under Chapter Heading 84.03 and for refund of excess customs duty of Rs. 45,519.53. It was their further plea before the Asstt. Collector that the goods by their very nature are spares for turbines, and are not assessable under any other tariff item other than Item 84.03 of the Customs Tariff. The Asstt. Collector held that as the items have been invoiced separately and declared as such in the Bill of Entry as 'spares', therefore the items are required to be assessed as per their merits. He also held that in absen....
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.... and tailor made for valves as parts of the turbine. Therefore, he submitted that the items are to be classified as parts of turbine to be under Heading 84.32. 7. Ld. DR submitted that the Note 1(g) of Section XVI is applicable to the facts of the case irrespective of the use of sleeves, spring holders and screws and they have been rightly classified as such. He also referred to Note 2 of Section XV and submitted that it has to be read to understand what a part of general notes. He submitted that it refers to sleeves springs etc. and being of general notes has to be classified on merits. He relied on the ratio of the judgment rendered in the case of Gordon Woodroffe & Co. v. Collector of Customs as reported in 1987 (27) E.L.T. 99 and that of Vardhman Spinning & General Mills v. Collector of Customs as reported in 1991 (53) E.L.T. 79, wherein it has been held that spring sleeves holders even of their parts are required to be classified on merits. Ld. Advocate countering the arguments submitted that these judgments are not applicable as the items are of general purpose use as spring holders and not tailor made items being parts of turbine and hence the ratio is distinguishable.....
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....re are tailor made and they have been specifically got manufactured from the suppliers as per the drawings and specifications. Therefore, it is their contention that the item has got to be classified as part and parcel of the main item i.e. turbine by application of Note 2 of Section XVI. There is force in the submissions made by the appellants in this case. The item is not a general purpose article of iron or steel but it is specifically designed and tailor made for use in the turbine as the spare parts. Therefore, by application of Note 2 of Section XVI, the item is required to be classified alongwith the main item i.e. turbine as being suitable for use solely or principally with a particular kind of machine. Ld. DR relied on Note 1(g) of Section XVI which states that parts of general use, as refund in Note 2 of Section XV of base metal, "Section XV", are similar goods of artificial plastic material which are generally classified under Heading 39.07 are excluded from Section XVI. We notice that this Note 1(g) is not applicable to the facts of the present case as the item is not a parts of general use as defined on Note 2 of Section XV of base metal or similar parts of artificial ....
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....s having been described as spare parts for turbines how and why a classification under 84.03 had been claimed; because Heading 84.03 as it stood during the relevant time, covered only generator such as 'Producer gas, water gas, acetylene gas and similar gas generators' and not Turbines or parts thereof; Whereas various types of Turbines were classifiable in those days under 84.07 and 84.08. 15. Again the piston valves have been classified under Heading 84.61 (1) by the department but the ld. Advocate has stated that they were prepared to accept classification under 84.61 (2) in view of the Tribunal's order in the case of Kerala State Electricity Board - 1995 (80) E.L.T. 346. 16. I am however, of the opinion that Heading 84.61 itself was not applicable. In the Tribunal's order in the case of KSEB (supra), the issue centered regarding the proposition as to whether the 'isolating valves' made of bronze were classifiable under sub-heading 1 or 2 of 84.61 and in view of the words 'such as' used in sub-heading 2, the Tribunal concluded that it is the sub-heading 2, which covered isolating valves, was appropriate. 17. In so far as we are concerned, we find that the Heading 84....
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.... In so far as the screws are concerned again screws would fall under 73.32 only if they were made of iron and steel and not otherwise but the metal has not been indicated. 22. There is yet another problem. Although in the working sheet the piston valves, the sleeves and spring holders and screws have been shown as spares for 7.5 M.V. Turbine yet in the application for refund of import duty dated 1st Dec. 1983 (at internal page 3) 'Plunger and sleeve for relay gear' '(i.e. piston valve, sleeve, spring holder, screws)' have been shown as spares "required for turbo generators" and not for Turbines as such. That generators are different from `Turbines', is well known. The Webster's New Collegiate Dictionary shows that : 1. Turbine is "a rotary engine actuated by the reaction or impulse or both of a current of fluid (as water, steam or air) subject to pressure and usually made with a series of curved vanes on central rotating spindle". 2. Turbo-generator is a generator "coupled directly to a driving turbine". Whereas, Generator is "a machine by which mechanical energy is changed into electrical energy". The Marks Standard Hand Book for Mechanical Engineers Eighth Editi....
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.... firm submits that these items were manufactured according to separate work orders but assembled together at the time of despatch and were intended to be used outside the turbine control mechanism and is essentially a part of the turbine control. 27. The ld. Counsel has discarded this submission at the time of hearing before us. But in view of the above discrepancies and differences in description and submissions at various stages, I am not surprised if the ld. Collector came to the view that the appellants have not been able to show that subject goods constituted sub-assemblies or were essential parts of the turbine themselves. 28. Since, verification of factual aspects is involved and the material placed before us is not sufficient to come to a definite finding and yet this much is clear on the basis of material on record that apparently both the appellant and the department have committed error, even at the original stage, the impugned orders are set aside and the matter is remanded to the Asstt. Commissioner concerned for de-novo consideration after verification of facts and re-classification accordingly. Sd/-   (S.K. Bhatnagar) Vice President dated 25....
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.... at the time of hearing and as a result of this omission the issue came to be considered by the Tribunal treating the import of the components individually. He has pleaded now that they have requisite evidence by way of invoice, the classification of the goods imported may be considered taking into consideration that what was imported was sub-assembly and not individual parts. He has prayed that the matter may be referred back to the Bench which earlier heard the matter. 31. The learned SDR for the Department after perusing the invoice accepts this position and he is of the view that inas much as one of the two items has been treated for assessment purposes as sub-assembly the second item also which has been invoiced likewise may also be assessed similarly. 32. I have considered the pleas made by both the sides. I observe that the points of difference referred to is in the context of assessment of individual parts which have been listed under the heading Plunger and Sleeve for Relay Gear. A perusal of the invoice shows that the goods shown under the heading Plunger and Sleeve comprises of two sets of different items and a total price has been shown for all these parts. ....
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....ave therefore considered this matter in the presence of the ld. DR who has been allowed to peruse the record of proceedings before the third Member along with the latters observations. 35. Ld. DR has stated that since the Madras DR has already made submissions before the third Member he has nothing further to add. 36. We have considered the matter. We observe that it is evident from the record of proceedings before the third Member that admittedly a new point was raised before the third Member. This point was not pleaded before this bench (original bench) at the time of hearing and the ld. third Member has observed that the matter is required to be brought to the notice of the Members of the bench who heard the matter earlier and therefore he was refraining from expressing any opinion on the point of difference which has been referred for his opinion. We have accordingly considered the matter and are of the opinion that since this bench had duly considered all the pleas raised before it and each of the Members of the bench had duly passed the order and thereafter the matter had been referred to the third Member it was upto the third Member to deal with the matter as he ....
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....le in the form of first invoice and the argument that the second invoice should be also considered in the light of this evidence could not be submitted during the first hearing before the Bench because no occasion arose to do so. However, since this is a strong evidence in favour of the appellants, therefore it cannot be brushed aside also, else there would be miscarriage of justice. 41. Heard ld. S.D.R. Shri Victor Thiagaraj, who submitted that since the case involved more appreciation of facts than points of law, therefore it would be in the interest of justice if the matter is remanded to the original authority for de novo consideration as has been held in the order recorded by Hon'ble Vice President Shri S.K. Bhatnagar. At this point ld. Advocate for the appellants rose to submit that normally when matters are remanded, they are taken up for consideration afresh by the original authority on his own convenience and it involves considerable delay, sometimes running into number of years. Therefore, he submitted that in the interest of justice it would be appropriate if certain time limit is fixed keeping practical consideration in view. Subject to this prayer, he had no diff....